December 26, 2025 — In a year when inflation cooled across much of the world and central banks delivered their biggest easing push in more than a decade, economic “winners” depended on what, exactly, you measured: growth, price stability, jobs, market confidence—or societal change. [1]
That tension is at the heart of two closely watched year-end scorecards circulating across European and global media. One is The Economist’s annual ranking of the best-performing advanced economies—where Portugal takes the top spot for 2025 and France places a solid but unspectacular 11th. [2] The other is the magazine’s “country of the year” tradition, focused less on macro data and more on improvement—where Syria is being highlighted by secondary reporting as the standout transformation of 2025, with Argentina frequently described as a close contender thanks to the dramatic, controversial stabilization attempt under President Javier Milei. [3]
Below is what the rankings actually track, why Portugal surged, what France’s 11th-place finish says (and doesn’t say), and how the global conversation shifts when the yardstick changes from “performance” to “progress.”
What The Economist’s 2025 “best economy” ranking actually measures
The Economist’s annual “best-performing economy” list is not a ranking of the biggest economies by GDP. Instead, it compares 36 mostly developed countries using five indicators meant to capture a balanced macro picture: inflation relative to a 2% target, the breadth of inflation (how widespread price increases are), GDP growth, employment trends, and stock-market performance as a proxy for investor confidence. [4]
The approach is intentionally multidimensional: a country can post strong GDP growth but score poorly if inflation is high or widespread; another can keep prices stable but rank lower if growth is weak or markets slump. In practice, the magazine ranks countries on each metric and then averages results into a final table. [5]
This year’s headline result: Portugal comes out on top—“economy of the year”—after Spain’s win in 2024, continuing a broader storyline that Southern Europe’s former crisis economies are increasingly the eurozone’s surprise outperformers. [6]
Why Portugal finished No. 1 in 2025
Portugal’s first-place finish reflects a combination that has been hard to achieve in the post-pandemic era: above-average growth, inflation that stayed relatively controlled, and a strong year for local equities. Euronews notes the Portuguese stock market rose by more than 20% in 2025, and highlights that the ranking is based on inflation, GDP, jobs, and market data across 36 rich countries. [7]
French financial-education site La Finance Pour Tous adds color on the domestic drivers The Economist emphasizes, pointing to a “flourishing” tourism sector and a tax attractiveness that has drawn wealthier foreign residents—factors that can bolster demand, investment, and employment while supporting confidence. [8]
The “Southern Europe comeback” is not only a Portugal story. Financial Times analysis over the past year has described a post-pandemic reversal in Europe, with Greece, Portugal, Spain (and, to a degree, Italy) outperforming northern heavyweights like Germany—helped by tourism, investment cycles, and EU recovery funds and reforms. [9]
The top performers: a table led by smaller, agile economies
Behind Portugal, Ireland and Israel complete the podium in much of the reporting about the 2025 table. [10] Spain—last year’s winner—shares fourth place with Colombia, followed by the Czech Republic and Greece. [11]
One widely circulated summary of the top 10 lists Portugal, Ireland, Israel, Colombia, Spain, Czech Republic, Greece, Canada, Slovenia, and Poland—underscoring that 2025’s “best performers” aren’t necessarily the largest economies, but those that combined decent growth with moderating inflation and supportive market sentiment. [12]
At the bottom sit Estonia, Finland, and Slovakia, with multiple summaries emphasizing how parts of Northern and Central/Eastern Europe struggled with weaker growth dynamics and/or inflation challenges. [13]
France at No. 11: strong on inflation, modest on growth, constrained by politics and debt
France’s headline: 11th out of 36—“in the first part of the table,” as La Finance Pour Tous puts it. [14] The site notes that despite significant political turbulence, France could still point to roughly 0.8% growth in 2025 and low inflation of about 0.9% year-on-year—described as the eurozone’s second-lowest annual inflation rate. [15]
That growth figure lines up with France’s own statistical and political messaging during the year. Reuters reported in September that INSEE forecast 0.8% growth for 2025, citing rebounds in sectors such as aeronautics, tourism, agriculture, and real estate—while also flagging political uncertainty as a risk to momentum. [16] By early December, Reuters also quoted Finance Minister Roland Lescure saying growth was likely to come in at least 0.8% unless the final quarter saw a sharp reversal. [17]
So why isn’t France higher than 11th? Because the same scorecard that rewards low inflation and stability can punish fiscal fragility and investor unease—and France’s public-finance story has been a dominant theme.
The fiscal warning lights: ratings pressure and rising borrowing costs
In September, Fitch downgraded France’s credit rating by one notch, citing persistent deficits, “high and rising” debt, and political instability complicating credible consolidation plans, according to Le Monde’s reporting in English. [18] Le Monde details the downgrade from AA− to A+, and notes France’s debt was around 114% of GDP at the time, with discussion that it could rise further in coming years. [19]
The same article quotes market and academic voices underscoring the stakes. It cites Hadrien Camatte of Natixis saying French debt remains “very good quality,” while also noting it is no longer top-tier; and quotes Eric Dor, director of economic studies at IESEG, on how some funds’ investment rules can limit holdings when sovereigns slip below certain ratings thresholds. [20]
The takeaway for France in the context of The Economist-style scoreboard: macro stability (especially low inflation) helps, but debt dynamics and political uncertainty can cap how far a country climbs in a ranking that includes market confidence as an explicit input.
Why the U.S. and Germany didn’t dominate this particular ranking
France’s 11th-place finish has drawn attention partly because it comes “ahead” of some bigger names in the same performance table—depending on the final league positions cited in different summaries. The underlying logic, however, is consistent: on a five-indicator scorecard, a country can be powerful and still place mid-pack if inflation is broad or growth disappoints.
La Finance Pour Tous highlights the U.S. case directly, arguing that America’s placement clashes with its reputation for dominance because inflation weighs heavily on the composite score. It claims that more than 85% of consumer products recorded price rises above 2%, suggesting a generalized “overheating.” [21]
Germany’s issue is the mirror image: weak growth. La Finance Pour Tous describes Germany—Europe’s largest economy—as suffering from “sluggish” growth while its economic model is being re-examined. [22] Financial Times reporting has similarly framed Germany’s post-pandemic struggle as a major reason the growth narrative has shifted south in Europe. [23]
The bigger 2025 macro backdrop: slower global growth, easing inflation, tariff uncertainty
The global environment matters because it affects all five indicators—growth, employment, inflation, and markets. In its October 2025 World Economic Outlook, the IMF projected global growth around 3.2% in 2025 (slightly slower than 2024), with advanced economies growing around the mid‑1% range. [24]
The OECD’s interim outlook in September also projected global GDP growth of about 3.2% in 2025, while warning that higher tariffs and policy uncertainty could weigh on trade and investment. [25]
And central banks pivoted decisively: Reuters counted 32 rate cuts across nine of the 10 most traded currencies in 2025, totaling 850 basis points—its biggest coordinated easing push since the 2008 era. [26] That shift helped cool inflation in many places, but it also put more attention on fiscal credibility and structural growth—two areas where countries’ stories diverged sharply.
“Best-performing economy” vs “most improved country”: why Syria and Argentina enter the conversation
The third link you provided (Atlantico) points to a related but distinct idea: the country that made the most progress in 2025—and it frames that story through the lens of Argentina’s Javier Milei, in commentary attributed to economist Pierre Bentata, a lecturer at Aix-Marseille University. [27]
This overlaps with (but is not identical to) The Economist’s separate year-end “country of the year” tradition, which—based on multiple secondary reports—focuses on improvement in ways that matter economically, politically, or socially, rather than raw wealth or power. [28]
Syria as “country of the year”: transformation after Assad
A Newser summary of The Economist’s year-end leader says the magazine named Syria its “country of the year” for 2025, arguing the country is “far happier and more peaceful” than in 2024 and pointing to millions of Syrians returning home. [29]
Reuters reporting provides the on-the-ground context behind that framing. On December 8, 2025—one year after Bashar al‑Assad was toppled—Reuters described nationwide celebrations and detailed the new government under President Ahmed al‑Sharaa, including shifting foreign ties, significant sanctions relief, and ongoing security and sectarian risks. [30] Reuters also cited the UN refugee agency saying that since Assad’s fall, around 1.2 million refugees plus 1.9 million internally displaced people had returned home—while warning that falling global aid funding could deter further returns. [31]
More recently, Reuters reported that Syria plans to begin swapping old banknotes for new ones from January 1, 2026—part of a broader effort to rebuild institutions and stabilize confidence in the currency after years of war and isolation. [32]
Taken together, the Syria story shows why “progress” rankings can diverge sharply from “best economy” rankings: Syria is not being celebrated for a pristine inflation print or a booming stock index, but for a measurable change in security, governance, and daily life—while still facing severe risks.
Argentina as the other big “progress” headline: stabilization at high social cost
Argentina’s 2025 narrative is different: not a post-war transition, but a high-volatility macro stabilization attempt under Milei that has produced striking headline improvements alongside real hardship—exactly the kind of trade-off that fuels heated debate.
On inflation, a Reuters poll in December estimated monthly inflation at about 2.4% in November (slightly above October), while annual inflation was expected to slow to around 30.9%—the 19th consecutive annual decline from an April 2024 peak near 289%. [33]
On poverty, Reuters reported in March that Argentina’s poverty rate fell to 38.1% in the second half of 2024, down from 52.9% in the first half of that year, after an initial spike when Milei took office in late 2023 and launched an austerity “chainsaw” program. [34] Reuters also emphasized that even with improving headline indicators, many Argentines continued to feel the pinch—describing people scavenging for food and taking informal low-salary work. [35]
The policy architecture shifted as well. Reuters reported in April that Argentina sealed a $20 billion IMF deal, loosened key currency controls, and moved toward a more flexible exchange-rate regime—steps aimed at restoring investment and rebuilding reserves, but also steps that can introduce volatility. [36] In December, Reuters quoted IMF spokesperson Julie Kozack saying Argentina’s monetary and FX policies would need to support more ambitious reserve accumulation to build buffers and facilitate market access. [37]
And the reform push isn’t slowing. Financial Times reporting this week described Milei’s government preparing another major slate of labor, tax, and other reforms for 2026, led by Deregulation Minister Federico Sturzenegger—moves supporters argue are needed for long-term growth and critics fear will weaken worker protections. [38]
This is why Argentina appears in “progress” conversations even when it is not topping the developed-world “best economy” table: the magnitude of change—especially on inflation—has been dramatic, and the political stakes are high.
What the 2025 rankings really tell us—and what to watch next
The Economist-style “best economy” table and the “most improved country” idea can be read together as a reminder that economic success is not one thing:
- Performance (Portugal’s 2025 story) rewards balance: growth that isn’t inflationary, jobs that hold up, and markets that believe the trajectory. [39]
- Resilience-with-constraints (France at 11th) can look “good” on inflation and steady on growth, yet remain limited by politics, deficits, and debt dynamics that affect investor confidence and borrowing costs. [40]
- Progress (Syria, Argentina) captures something else entirely: rapid improvement after regime change, or rapid macro stabilization after a crisis—often messy, often incomplete, and rarely painless. [41]
Looking into 2026, three forces are likely to shape next year’s leaderboard battles:
- The rate-cut aftershocks. 2025’s synchronized easing helped calm inflation but could shift the risk mix in 2026—especially if growth disappoints or inflation re-accelerates. [42]
- Fiscal credibility in Europe. Countries with rising debt-service costs may find that even “good” inflation numbers don’t offset market pressure if budgets look politically unmanageable. [43]
- Trade barriers and uncertainty. The OECD has warned that higher tariffs and policy uncertainty can drag on investment and trade—variables that feed directly into growth, jobs, and markets. [44]
For readers trying to make sense of the headlines: France’s 11th-place finish is real—but it’s best interpreted as a snapshot of 2025’s macro balance, not a final verdict on long-run competitiveness. And the year’s bigger lesson may be that in a volatile global economy, the most compelling stories are not always about who is biggest—but who is changing fastest, and at what cost.
References
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